Monday, August 09, 2010

This Is Your Grandfather’s iPad

Aug. 6 (Bloomberg) -- Hikosaburo Yasuda says he knows a trend when he sees one and plans to buy Apple Inc.’s iPad to keep up with junior members in his computer club. Yasuda is 95. “It’s important to always try new things, otherwise you get left behind,” Yasuda said. “All these books in just one place, and so many familiar, classic titles that I’ve never had a chance to read. I want to buy the iPad just for that.”
Yasuda and his peers, looking for easier ways to browse the Web and send e-mails, are a potentially lucrative demographic for Apple as the proportion of people aged 65 and over climbs to records each year in countries including the U.S., China and France. Japan has the world’s oldest society, with the elderly accounting for an estimated 22 percent of the population, almost triple the global average.
“The iPad is a good tool for the elderly because it’s very forgiving of mistakes, something the seniors fear when dealing with computers,” said researcher Takahiro Miura of the University of Tokyo, whose team is working with International Business Machines Corp. on using computers to help senior citizens rejoin the workforce. “Unlike the PC, it doesn’t require prior knowledge.”
Android Competition
Motoo Kitamura, 78, a former gas salesman, said the tablet helps him communicate with his 2-year-old grandson, who turns it on himself to play games. Kitamura uses it to follow the Hanshin Tigers baseball team and show vacation pictures.
“I think using the iPad could help keep dementia at bay,” he said. “Trying new things like that is a good mental exercise.”
James Cordwell, a technology analyst at Atlantic Equities Service in London, said the iPad’s appeal to the elderly is helping the company reach beyond its traditional base of younger customers and fend off Google Inc.’s Android mobile-device operating system, which targets more technologically savvy users.
“Demographically, the world, especially in developed markets, is getting older and it’s probably where Apple is least penetrated,” Cordwell said. Elderly users are “a key source of growth for them in the future.”
Apple, the world’s biggest technology company by market value, said net income leaped 78 percent and revenue reached a record $15.7 billion last quarter, the first to include sales of the iPad tablet computer and the newest iPhone.
BlackBerry, Hewlett-Packard
Customers bought 3.27 million iPads, which sell for $499 in the U.S. and 48,800 yen ($565) in Japan for the low-end model. Research firm ISuppli Corp., of El Segundo, California, said Apple may ship 12.9 million this year.
“Every age group is important to Apple,” said Carolyn Wu, a Beijing-based spokeswoman for Apple. The Cupertino, California-based company doesn’t provide a breakdown of iPad sales by region or age.
Apple faces competition from BlackBerry-maker Research In Motion Ltd., which plans to introduce a tablet computer in November, two people familiar with the plans said last month. Hewlett-Packard Co. and LG Electronics Inc. also said they plan to introduce tablet computers.
The iPad’s appeal to seniors extends beyond Japan. Marti Weston, of Arlington, Virginia, bought her father one for his 87th birthday in May. She downloaded applications for newspapers, classical music, the Bible and works by Plato and Shakespeare.
‘Disciplined Finger’
Her father, the Rev. Elmo Pascale, of Harrisonburg, Virginia, found it frustrating to type his journals into a computer using Windows, she said. Weston gave her father tutorials on the iPad, and now he’s downloading lectures and searching YouTube for videos.
“This ‘book-sized’ pad has become my news and entertainment source, requiring only a disciplined index finger and a rare recharging of its battery,” Pascale wrote on his daughter’s blog. “Thanks a million!”
Eiji Mori, an analyst at research firm BCN Inc. in Tokyo, said elderly consumers unfamiliar with technology are drawn to Apple.
“The iPad’s intuitive interface and the ability to enlarge text make for an appealing proposition to seniors,” Mori said. “It will rapidly increase in popularity among the elderly once the product shortages are dealt with and there is a selection of appropriate contents, such as e-books.”
Elderly Spending
The iPad also could help reintroduce the elderly into the workforce and create more opportunities to interact with young people, Miura said.
The Nakano Community Center frequented by Yasuda offers three computer clubs run by Toshihiro Okada, a 79-year-old retired architect. Members call him “The Saint” because he often bikes to their homes to troubleshoot computer problems.
He said three elderly friends bought iPads.
“Seniors these days have the trifecta of time, money and curiosity,” Okada said. “The iPad is never out of my hands.”
Annual spending per person in a Japanese household of people 65 and older was 1.34 million yen last year, higher than the national average of 1.24 million yen and second only to the under-30 age group, according to a report by the country’s Cabinet Office.
The elderly devote about 15.4 percent of household expenditures to entertainment and cultural activities, compared with the 13.5 percent national average, the report said.
Masato Enjuji, 89, and Yoshitaka Yamazaki, 77, said they bought iPads mostly out of curiosity after seeing Okada use his.
Enjuji, a retired sundry wholesaler, reads e-books and browses photos. He likened his discovery of the device to the time he learned Morse code as a 17-year-old.
“You’ve got to use your head, your eyes, your hands,” he said. “You can’t wall yourself in by thinking something is too difficult.”
To contact the reporters on this story: Pavel Alpeyev in Tokyo at palpeyev@bloomberg.net Yoshinori Eki in Tokyo at yeki@bloomberg.net .
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